Monday, January 19, 2009


OK, I think this is the biggest SCAM EVER! Have you looked closely at your credit card bills recently? Have you read those annoying notifications about "Amendment to Your Account Agreement" that are in typeface so small you need a magnifying glass to read or that is tucked in with all the advertisements they stuff in with your bill?

One of our sons brought this to my attention when the minimum payment on his credit card more than DOUBLED -- and in looking at his interest rate, he realized that it had almost tripled. So, knowing that he had not missed any payments, had no late payments, had not exceeded his credit limit (in fact, they recently DOUBLED his available credit line to an amount that approaches his annual salary!), he called Citibank and was told the interest rate was being increased "due to market conditions". He asked the customer service rep (who obviously was reading from a prepared script), "WHAT market conditions?" And she said, "General economic conditions..." When my son told me his conversation, I was just simply incensed! So I went
to the web sites of a number of credit card companies and found that ALL of them are FLEECING AMERICA -- Citibank, Chase, Wells Fargo, Bank of America -- even USAA which is supposed to be a financial association for the benefit of the members (past & present) of the Armed Forces and their families! Not all are charging exorbitant new rates -- but all have increased their rates: some rates were effective January 1... some will be effective in February!

Here is how this scam works: virtually every single credit card charges interest based on a formula of the Prime Rate -- that is, the rate the banks borrow money from the Federal Reserve -- PLUS some percentage... the lower your credit rating, the higher your "+ %" is. Now these banks -- which have received hundreds of millions -- nay BILLIONS -- of our tax dollars from our noble (and I use that word loosely) Congress supposedly to permit these banks to continue loaning money to people (that would be you and me.) Well, these banks are borrowing money from the Federal Reserve at the insanely low rates of 0.25 - 1.0 % which has resulted in wonderfully low interest rates on credit cards -- benefiting the people who need the help most!

Now these same banks are telling you and me that "due to market conditions" that the "+%" is being increased -- doubled and even tripled! WTF?? And it's not just future purchases -- the new interest rates are on the entire balance! So if you made a purchase (stimulating the economy with your purchase) on a credit card at a nice low interest rate that you figured you could afford the payments, that purchase will also be assessed the new interest rate! And, yes, you can "opt out" and keep your low interest rate -- but you have to agree to either cancel the card or not use it again -- if you do, your use signifies your "agreement" with the new interest rate!

First these banks get OUR money via the Congressional bailout, next they are permitted to borrow OUR money from the Fed (remember, government doesn't have any money of its own -- ALL its money comes from US via taxes!) at ludicrously low rates and now they want to SCHTUPE us by telling us THAT MARKET CONDITIONS DEMAND AN INCREASE in these rates? WHAT market conditions? GREED is not a market condition. The banks bad mortgages and their over extension of credit to those who were/are not creditworthy are NOT market conditions for which the public should be paying!! Propping up the banks' share prices for the benefit of their stockholders are NOT market conditions for which the public should be paying! I understand that banks are entitled to make a profit and to pay their LEGITIMATE administrative expenses -- but since when was 8% (of loaned money) not a reasonable profit? When did it become acceptable to set 13, 14, 15% to be "reasonable" profit levels?? And please don't tell me that the new credit card reform will help -- that bill (which would actually stop SOME of this) isn't effective FOR 18 MONTHS (August 2010!) -- by that time, more people will be bankrupt or in default and interest rates will already be so high what would be the point??

Seriously, if the Congress intends to give MORE of my money to the banks, I think the minimum condition to receiving this money should be that these banks accept the terms of that legislation NOW!!

If the new President and people like Ted Kennedy, Harry Reid, Barney Frank, Nancy Pelosi, et al. REALLY want to help the American people through these hard economic times, this is as good a place as any to start.

And lest they think this somehow benefits the "rich" -- I remind them that the "rich" have other resources and do not carry the significant portion of the country's revolving debt -- the POOREST people of our country are hurt far more by these banking practices! Not to mention that this is seriously NOT the way to stimulate the economy! This is an outrage and if they don't know it, they SHOULD!!

I encourage every one of you to copy & paste this and SEND IT IMMEDIATELY to your Congressperson and Senators. This is an OUTRAGE! THIS is the place we HOPE for CHANGE!


Labels: , ,


Post a Comment

Subscribe to Post Comments [Atom]

<< Home